A Native American tribe is set to drop a bombshell bid to build and run the city's first casino — a $1.4 billion gaming palace at Aqueduct Racetrack, the Daily News has learned.

The last-minute proposal may be a long shot, but the Shinnecock Indians are hoping to entice the city and state with the prospect of a half-billion dollars in revenue a year.

The tribe also is dangling another sweetener: a promise to drop its fight to build a casino on its ancestral lands in Southampton, which has roiled the playground of the rich and powerful.

The Shinnecock bid, which will be submitted to the state tomorrow, aims to upend plans for a smaller video-lottery complex at the Thoroughbred race track in Ozone Park, Queens.

Three companies are expected to submit bids to run that lottery facility, a racino slated to have 4,500 video terminals.

But the Shinnecock — who are teamed with a Michigan sports mogul who operates a Detroit casino — have a far grander vision rivaling Foxwoods and Mohegan Sun in Connecticut.

The bid calls for a million-square-foot casino with 10,500 slots, 350 gaming tables and 12,000 employees. A 1,200-room hotel and other amenities would be built with community input, the tribe says.

"It would be great for the City of New York," said Fred Bess, a Shinnecock trustee. "New York is tired of watching all the gaming revenues going to Atlantic City and Connecticut."

Though casinos are illegal in New York, federally recognized Indian tribes can build gambling facilities on their reservation land.

In 2003, the Shinnecock sparked an uproar by breaking ground for a casino on an 80-acre parcel called Westwood on the east end of Long Island.

The town of Southampton and the state responded with a federal lawsuit seeking to stop the tribe. A trial ended in May, and a decision from the judge could come any day.

The Shinnecock believe they are likely to win the case — and they are also hopeful about a pending suit that lays claim to 2,800 acres of Hamptons land and demands billions from the state for seizing it.

The litigation, they believe, can be used as leverage to forge a deal on Aqueduct. Powerful opponents of a Hamptons casino theoretically would lobby for the Shinnecock to run a facility in the city instead.

But even if the political stars aligned, the Shinnecock would face another stumbling block: They must be federally recognized as a tribe to open a casino.

A federal judge's ruling recognized the Shinnecock in 2005, but the tribe is still trying to force the U.S. Department of the Interior to acknowledge it. A lawsuit was filed last year.

Bess said he is optimistic the tribe can negotiate a global settlement with the state and feds — giving it tribal recognition and making the land around the racetrack reservation property.

"I think it's a good shot and anybody who looks at it will have to give serious consideration," Bess said.

The Shinnecock have no experience running a casino but they have partnered with Gateway Casino Resorts, a venture of Michigan business mogul Marian Ilitch.

Ilitch, who co-founded Little Caesar's Pizza and owns the Detroit Tigers and the Detroit Red Wings, owns the MotorCity Casino Resort in Detroit and should be considered a serious player, an industry analyst said.

"They're kind of a small company but I think they have a lot of respect," said Roger Gros, publisher of Global Gaming Business magazine.

He said MotorCity has performed as well as the MGM Grand Detroit under Ilitch's control. "That has really impressed me," he said.

The Aqueduct bid estimates a full-size casino would bring in $2.1 billion annually. The city and state would share a 25% kickback from the $1.5 billion generated annually by the casino's slot machines and would receive added tax revenues.

By contrast, the video lottery racino that opened at Yonkers Raceway last October with 5,500 terminals grossed $350 million in its first year.

The Shinnecock would have nothing to do with horse racing. Gov. Spitzer has endorsed a plan for the New York Racing Association to continue operating the track.

Other players in the hunt for gambling gold

Before the Shinnecock Indians entered the fray, three private companies were vying to run the gambling operations at Aqueduct Racetrack.

Empire Racing, Excelsior and Capital Play all submitted proposals to take over horse racing at Aqueduct, Belmont and Saratoga and run the video lottery terminals at Aqueduct.

But Gov. Spitzer has recommended the New York Racing Association keep the horse-racing franchise at all three tracks — and a separate contract be awarded for the video slots.

The deadline for bids is tomorrow. It's unclear who will step forward. But here's a look at the companies that have expressed interest:

could you imagine. getting all dressed up to go to the casino, and then hop an A train to Ozone Park! haha. the fact that its so close to manhattan is a major boon. but that is such a crappy neighborhood, the calls that its going to bring in the wrong crowd is not an exaggeration. ive been in that area many times, if you want to see what you're getting, check out the OTB in the area and see the future clientele

Or a racino, to use the gambling industry’s term: a gambling emporium built into the Aqueduct thoroughbred track in Queens that will include 4,500 video slot machines, but no table games.

Desperate for revenue, the state has put plans to develop a racino at Aqueduct on the fast track. While the plan has been at various stages for years, state officials are aiming to choose among the three bidders vying to develop the racino in a matter of weeks, though final agreements among state leaders often prove elusive in Albany.

But given the weakening economy and widening budget deficits, the state is motivated to expedite the process, and a bidding group led by the developer Stephen L. Green and the operators of the Hard Rock Cafe chain is even promising to open a temporary racino by the end of this year.

At stake is the $10 billion to more than $20 billion in revenue that the state will reap over the life of what would be a 30-year lease, depending on which bidder is making the projections, as well as an upfront licensing fee.

“We would hope that in roughly a year we’d have a facility open,” said Paul Francis, director of operations for Gov. David A. Paterson. There are several racinos in the state, but none at the three state-owned thoroughbred tracks: Aqueduct, Belmont and Saratoga.

Like many issues decided in the capital, the bids are secret — beyond what details the bidders were willing to release — and the winner will be chosen behind closed doors by the so-called three men in a room who run the state, Governor Paterson and Assembly Speaker Sheldon Silver, both Democrats, and the Senate majority leader, Joseph L. Bruno, the state’s top Republican.

Because the process is private, it will not be clear to what extent merit or political influence and campaign contributions affect the decision making. The secrecy, Mr. Francis said, “will help the policymakers make a decision on the merits of the proposals rather than on a political campaign that seeks to promote the merits of one bid and the demerits of an alternative proposal.”

The bids range in ambition. All of the bidders are proposing renovating the aging facilities with enough of a gloss to entice a flurry of traffic before considering a second phase of development. The state will raise $250 million through a bond offering for the construction project.

Connecticut’s Mohegan tribe, which operates the giant Mohegan Sun resort and casino, is part of a bidding group called Capital Play, which has an ambitious plan to transform Aqueduct over the next several years into a Mohegan-style entertainment complex. The group even talks of extending the AirTrain from the nearby Kennedy International Airport to the Aqueduct site. Their bidding group includes Extell Development, a major Manhattan-based real estate developer, and Plainfield Asset Management, a large hedge fund.

But the group’s upfront bid is on the low end, a $250 million investment that includes a $100 million licensing fee and $150 million to redevelop the site. The state is already counting on a $250 million licensing fee to balance the budget.

To sweeten the pot, the group is promising to spend an extra $25 million to $30 million a year on marketing above the state’s requirements, which it believes will bring in substantially more revenue over time. The group also says it intends to spend an additional $700 million on a second phase of development within a couple of years, which would be used to add a hotel and mall.

“You have to build a hotel, and retail, so it becomes a Mohegan-style complex, so it’s not focused on gaming as much as entertainment,” said Karl O’Farrell, the president and chief executive of Capital Play. “There will be good-quality restaurants, nightclubs.”

“We want it to be J.F.K.’s waiting room,” he added.

Another bidder, Delaware North, has a more scaled-back but also more immediately lucrative proposal. The group, owned by the Jacobs family of Buffalo, would pay the state a $370 million licensing fee upfront, though it would not use more than the state is offering through its bond sale to develop the site.

The group envisions a racino similar to a popular one it operates in Saratoga Springs, N.Y., which is attached to a harness racing track, and would include a large parking deck.

“It’s going to have a lot of electricity, a lot of lights and a lot of entertainment,” said William J. Bissett, president of the gambling and entertainment division of Delaware North. “It’s going to feel like a place you want to be.”

The third bidding group includes Hard Rock International, which was acquired by the Seminole Tribe of Florida in 2006, along with the real estate firm SL Green.

The group is offering $250 million as a licensing fee and a $130 million investment in the construction project. In addition, it is proposing to spend $28.5 million to finance upstate horse farms and breeding, which could appeal to Mr. Bruno, who is himself a horse breeder upstate. The group says it would spend $30 million to $100 million over the life of the lease on capital improvements.

This group is proposing to open a temporary gambling floor by the end of the year while it works on overhauling the existing facilities. And, in a proposed second phase of development, it would add a Hard Rock Cafe.

With so much money on the line, there has been a whisper campaign as the bidders vie for supremacy, and even resentment among local New York tribes that bristle at the idea that the state would let an out-of-state tribe run the racino.

“This is a New York project,” said Frederick C. Bess, chairman of the Shinnecock Indian Nation on Long Island, which has sought to develop a casino at Aqueduct and elsewhere but lacks federal tribal recognition. “I would think if any tribes would be considered, it would be a New York tribe.”

Some critics also suggest that the Mohegan Sun group would not aggressively compete to keep New Yorkers here since its business in Connecticut has been enriched by cross-state traffic.

When asked about the issue, Marc Holliday, the chief executive of SL Green, said, “I think that it’s in the interest of New York State to have a gaming operator whose sole focus is going to be on maximizing revenues at the facility in New York City and not have any competing operations in Pennsylvania, New Jersey, Connecticut or other competing areas.”

Mr. O’Farrell said, however, that Mohegan’s database of its New York customers and its system of rewards points, which can be used at any Mohegan resort, would be a competitive advantage.

The bidding process is the latest step in the state’s tortuous oversight of its thoroughbred racing franchise. In February, after years of delay, the state granted a 25-year extension to the New York Racing Association to oversee racing at the state’s three thoroughbred tracks. The association has been plagued by scandal and mismanagement and is in bankruptcy court.

While racing has often been a sinkhole for taxpayers, state officials would like to see the Aqueduct racino — and its 4,500 video lottery terminals, referred to as V.L.T.s — help plug a $5 billion deficit projected for next year.

“The State of New York has made it crystal clear to us they want revenue generated as soon as possible,” said Mr. Bissett, of Delaware North.

John McArdle, a spokesman for Mr. Bruno, said: “The sooner there’s an agreement, the sooner we can get V.L.T.s up and running and have revenue for the state. That’s the bottom line.”

__________________NEW YORK. World's capital.

“Office buildings are our factories – whether for tech, creative or traditional industries we must continue to grow our modern factories to create new jobs,” said United States Senator Chuck Schumer.

the type of crowd that walks in and wastes money at slots etc is exactly the crowd they want... do you think the casino cares if some of the clientelle are sketchy? no

I haven't been there, but they've had a lot of success with Empire City in Yonkers. My childhood neighborhood was in the area (South Ozone Park) and I still go there sometimes to visit, so this is interesting to me.

With that location, in the country's biggest city, it's a guaranteed success, something else to put Queens on the map. No doubt half of Brooklyn will be there...

__________________NEW YORK. World's capital.

“Office buildings are our factories – whether for tech, creative or traditional industries we must continue to grow our modern factories to create new jobs,” said United States Senator Chuck Schumer.

A report on bidders seeking Aqueduct's gaming contract is in the hands of the state's top leaders, indicating that a decision might be made soon.

After conducting background checks, the state Lottery Division has deemed each of three bidders qualified to run Aqueduct's proposed 4,500 machine video lottery terminal facility.

Lottery's report, following review by the state Inspector General's Office, was given to Gov. David Paterson, Senate Majority Leader Dean Skelos, R-Long Island, and Assembly Speaker Sheldon Silver, D-Manhattan, several days ago.

"At this point they can begin to have discussions about which one will be best for the state," said Morgan Hook, a Paterson spokesman. "I wouldn't put a timetable on it."

Background checks were conducted by the state Division of Lottery, which oversees video lottery terminal operations. Aqueduct is slated to get 4,500 machines that are expected to generate more than $450-million per year.

Lottery’s report, following review by the state Inspector General’s office, was sent to Paterson, Senate Majority Leader Dean Skelos (R-Long Island), and Assembly Speaker Sheldon Silver (D-Manhattan), within the past few days.

“At this point they can begin to have discussions about which one will be best for the state,” said Morgan Hook, a Paterson spokesman. “The three of them did discuss it briefly on Sunday.”

The trio met in person at the governor’s mansion in Albany. Talks focused on the state’s fiscal condition, the economy, and property taxes. Aqueduct is a closely related subject because New York is facing a nearly $5-billion budget deficit and loses $1-million each day that VLTs are not operational.

“If that [racino] had been up five years ago we’d be $2.5-billion better off in this state,” former Senate Majority Leader Joseph L. Bruno said recently.

Lottery’s report concluded that each bidder is qualified to run Aqueduct’s gaming facility. The selection requires approval from all three state leaders.

Entities seeking the contract are Delaware North Companies, which is partnered with Saratoga Harness Racing Inc.; Manhattan’s SL Green Realty Trust and Hard Rock Entertainment, which is owned by Florida’s Seminole Indians; and Capital Play Inc. and its partners: Mohegan Sun casino of Connecticut, Extell Development, and Plainfield Asset Management.

Delaware North owns Finger Lakes Racetrack, the state’s only Thoroughbred venue that currently has gaming, located southeast of Rochester in upstate New York. Delaware North also runs VLTs at Saratoga Gaming and Raceway, a Saratoga Springs harness track directly across the street from Saratoga Race Course.

The company is counting on these ties to help it win the Aqueduct contract. However, Capital Play/Mohegan Sun touts its experience in the New York City marketplace, saying it already has a large, well-established customer data base to draw upon.

Likewise, SL Green is one of New York’s largest owners of commercial real estate and has 67 properties in the greater metropolitan New York area. Hard Rock’s highly successful and well-recognized name is a cornerstone of the group’s bid.

There are no indications, however, about which entity might have an inside track with state leaders and while Lottery’s report is complete, there’s no guarantee that a decision will be made soon.

“I wouldn’t put a timetable on it,” Hook said. “The three of them can sit down and meet any time. It’s not that hard to arrange.”

Racino construction is expected to take at least a year, meaning a facility could be operational by late 2009.

__________________NEW YORK. World's capital.

“Office buildings are our factories – whether for tech, creative or traditional industries we must continue to grow our modern factories to create new jobs,” said United States Senator Chuck Schumer.

But Senate Majority Leader Dean Skelos has balked, saying that while Delaware North would provide more money upfront, the plan may not be as good in the long run.

Unlike the other finalists, Capital Play and SL Green, Delaware North has not come up with plans for the site beyond the video slot machine parlor, Skelos noted.

Delaware North officials said Monday that while the company submitted no additional plans, it intends to ultimately build a "world-class, four-star conference center and hotel facility."

In June, the firm hired The Peebles Corp., said to be the country's largest African-American real estate development company specializing in urban redevelopment.

Chairman and CEO Donahue Peebles said he is designing plans that would include a 3,000-seat theater for concerts and boxing. There would also be a 60,000-square-foot conference and meeting facility with a ballroom, a 5,000-square-foot spa and a 2,000-space garage.

In addition, Peebles said, there would be 15,000 square feet of "boutique retail" along the entrance to the racino - with more once the hotel is built.

"The idea is to take Aqueduct and make it a world-class destination attraction," he said.

Delaware North and Peebles hope to meet with Skelos this week to outline their plans.

Once the final approvals are in place, it should take 12 to 14 months to build the racino, said Delaware North Cos. Gaming & Entertainment President William Bissett.

He said Delaware North and its partners have cash reserves and lines of credit that would let them pay the state $370 million upfront and build the $250 million racino, which will open first. The hotel, conference center and a possible regional shopping center would follow within five years, Bissett added.

__________________NEW YORK. World's capital.

“Office buildings are our factories – whether for tech, creative or traditional industries we must continue to grow our modern factories to create new jobs,” said United States Senator Chuck Schumer.

After seven years of political wrangling and delay, a deal to build a casino at the Aqueduct racetrack is now in place.

Under a contract announced by the Paterson administration on Thursday, a Buffalo company will construct a complex featuring a 184,000-square-foot gambling floor and 4,500 video gambling terminals, multiple restaurants including one with a 600-seat buffet, at least 300 hotel rooms and a 60,000-square-foot conference center.

The Buffalo company, Delaware North, said it planned to start construction in early 2009 and finish the casino, its adjoining restaurants and the parking structure in about a year. The project will be completed in phases within five years, it said.

In its promotional material, Delaware North has boasted that the complex will be “all right in the heart of Queens,” a subway ride away on the A train. The track is in South Ozone Park just northwest of Kennedy Airport.

For the casino itself, gamblers should think more arcade than Atlantic City. There will be no blackjack tables with dealers, or roulette wheels. Instead the casino will have video-screen terminals that will accept money for virtual hands of poker and other games.

Delaware North operates a similar hybrid racetrack-casino — known as a racino — in Saratoga Springs. The company beat out two other bidders — the commercial real estate firm S L Green Realty, in partnership with Hard Rock Entertainment, and Capital Play, which had joined with Mohegan Sun.

State officials said Delaware North prevailed because it was offering more money in advance: $370 million for its license to operate the casino and entertainment complex.

“They offered the most money up front,” said John D. Sabini, chairman of the New York State Racing and Wagering Board. “And I think that’s important to the state because of the financial situation we’re in.”

In addition to the up-front payment, the state expects to reap more than $10.3 billion in revenue from the gambling terminals over the next 30 years.

Though the State Legislature has already trimmed more than $420 million in state spending this year, Gov. David A. Paterson said this month that the faltering economy had opened a new $1.2 billion hole in the budget.

After the Aqueduct negotiations hit a snag two weeks ago when Senate Republicans said they wanted more time to review the plan, Mr. Paterson and fellow Democrats accused Republicans of dragging their heels and delaying the start of a project that would create about 1,000 construction jobs at a time when employers in New York are shedding workers.

“This deal will provide a critical revenue stream — especially given the financial crisis that is battering our state and nation,” Mr. Paterson said in a statement,

The push to build a casino at Aqueduct began in 2001, when in the weeks after the Sept. 11 attacks the Legislature began passing laws that would allow for a major expansion of the state’s gambling industry.

In approving the deal, the state once again finds itself turning to gambling to strengthen its weakened cash flow. But with New Yorkers expected to spend less as the financial crisis expands, Delaware North’s president was asked on Thursday whether a casino could remain a steady source of state revenue during an economic downturn.

“Clearly the gaming business is not a recession-proof business,” the president, William J. Bissett, told reporters in a room overlooking the neatly groomed racetrack at Aqueduct.

“There is a large population that will have an easy means to get to this location to entertain themselves,” he said. “We take comfort that, even in a recession period, the fact that Aqueduct sits where it does in a huge metropolitan community buoys our confidence that we will be successful here.”

The project is expected to create about 2,000 jobs in Queens. About half those jobs would be permanent jobs at the casino complex once it is fully operating, and the rest would be construction jobs.

“The ultimate goal, of course, is not only to create revenue for the state but to create jobs,” said State Senator Serphin R. Maltese, a Republican from Queens. “So as far as economic development, I think you can put it in big letters: J-O-B-S.”

Mr. Maltese, who is locked in a competitive re-election battle that may decide which party controls the Senate next year, objected to the Delaware North proposal two weeks ago after Mr. Paterson and the Democratic-led Assembly signed off on it.

At the time, Mr. Maltese and other Senate Republicans said they were not convinced the plan included enough economic benefit for the Queens community. So the developers agreed to put more of their plans in writing, including the proposal for building the hotel and convention center and a community advisory board to inform Delaware North on their satisfaction with the development. In addition, the company agreed to open an office in the community that will make it more convenient for people to apply for a job.

__________________NEW YORK. World's capital.

“Office buildings are our factories – whether for tech, creative or traditional industries we must continue to grow our modern factories to create new jobs,” said United States Senator Chuck Schumer.

UPDATE Last updated: October 27, 2008 04:54pmDelaware N. HQ Expands as Part of $371M Plan

Aqueduct rendering

By Natalie Dolce

QUEENS, NY-Gov. David Paterson revealed on Monday that Delaware North, which was selected to operate the 328,000-sf Video Lottery Terminal facility at the Aqueduct Racetrack, as GlobeSt.com previously reported, will add 50 jobs at its Buffalo-based headquarters. The company will also look to break ground on the new facility in Queens by early 2009.

The selection of Delaware North was made by Gov. Paterson, Speaker Sheldon Silver and Senate Majority Leader Dean Skelos last week.

Delaware North will invest $370 million up-front to build and operate the VLT facility. As part of the development package, Delaware North will use the services of the Peebles Corp., an African-American-owned real estate development company, and McKissack & McKissack, an African-American, woman-owned professional design and construction firm, according to a prepared release.

Funds from the VLT facility at Aqueduct "will provide sustained resources for elementary and secondary education, while also supporting the operation and improvement of the three thoroughbred racing facilities," according to a statement. Once operational, the VLT facility is expected to bring in at least $8.2 billion for education over the next 30 years.

According to the current education funding formula, the Buffalo City School Districts would receive allocations of $4.4 million and Erie County School Districts would receive $11.8 million during the first year that video lottery terminals are up and running.

A Delaware North spokesman tells GlobeSt.com that completion is expected in early 2010. The spokesman also notes that the 50 jobs added in the Buffalo area will support construction management, technology, marketing, human resources and gaming management needs at Aqueduct.

Delaware North Cos., the racetrack and casino operator, is updating its plans for a casino at Aqueduct racetrack in New York City but has still not finalized an agreement with the state on the casino's operation, officials for the company and Aqueduct said on Friday.

Workers for the company have made several visits to Aqueduct within the last week to conduct architectural surveys, according to Ron Sultemeier, a Delaware North vice president, and Aqueduct officials. The workers updated architectural drawings and collected information for the company's zoning and permit applications, Sultemeier said.

Delaware North was selected late last year to build and operate the casino. The company, however, has yet to sign a memorandum of understanding with the state that would allow construction to begin. Complicating the situation is the possibility that the state will approve slot machines at nearby Belmont Park, which would create competition for the Aqueduct casino.

Sultemeier said that a range of issues are involved in negotiating the final agreement, including when the company would make a $370 million payment to the state that it pledged at the time it won the bid for the casino in October.

Sultemeier said that none of the issues was threatening the viability of the company's proposal.

"We're certainly spending a lot of money," Sultemeier said. "But there are still a lot of major steps to get done before we can put a shovel in the ground."

Slot machines were legalized at nine New York racetracks, including Aqueduct, in 2001. The Aqueduct casino., however, has been stalled by political and financial issues surrounding the New York Racing Association, which operates Aqueduct, Belmont, and Saratoga.

__________________NEW YORK. World's capital.

“Office buildings are our factories – whether for tech, creative or traditional industries we must continue to grow our modern factories to create new jobs,” said United States Senator Chuck Schumer.

A new report recommends that a casino and hotel be built at the Belmont Park racetrack in Nassau County to generate jobs and revenue for state and local government.

Options for the redevelopment of an approximately eight-acre parcel adjacent to the racetrack grandstand include a hotel and racino, according to the Belmont Park Redevelopment Study, released this week by the Empire State Development Corp. and the New York State Racing and Wagering Board.

Redevelopment options for a larger parcel of about 28 acres include retail, a small hotel, senior housing and recreational opportunities.

Before the project can go to bid, however, the state and other stakeholders must conduct further financial and economic feasibility analysis to determine a preferred option based on the most marketable and beneficial uses for the property. Once that once is approved by the state, requests for proposals could go out, followed by a public and environmental review process.

New York Gov. David A. Paterson said Belmont Park is an enormous economic development asset for the state, and "in these times of fiscal crisis, it’s important that we move forward with projects like Belmont, which can create new jobs, generate additional tax revenue and bolster economic development in the surrounding communities in Nassau and Queens Counties."

Although Belmont Park is the third jewel in racing's storied Triple Crown and has been an enormously successful horseracing venue for more than 100 years, "its full development potential has never been realized," said John Sabini, chairman of the state Racing and Wagering Board. With the study, "we are reawakening this sleeping giant of a state and community asset," Sabani said.

ALBANY — Scratch those plans for the first casino on a subway line in New York City — at least for now.

Plans to build a casino at the Aqueduct racetrack in Queens have collapsed, the latest victim of the financial turmoil that has tightened the credit markets.

Delaware North, the Buffalo company that was contracted to build and operate the casino, has not been able to get the financing to raise the $370 million it was to pay the state upfront, officials said. That leaves the state with yet another hole to plug in its ever-leakier budget.

“Today we informed the governor’s office that we are unable at this time to conclude a memorandum of understanding with the state to develop the Aqueduct facility,” William Bissett, Delaware North’s president, said in a statement. He added that “there has been a deterioration of the credit and equity financial markets in this recession economy which has caused Aqueduct Gaming L.L.C. to restructure the timing for its financial offer.”

The company had offered to proceed with the deal but delay its upfront payment; the state, however, was said to be concerned about a legal challenge if it allowed the winning bidder to alter the terms of its deal.

A spokesman for Gov. David A. Paterson expressed disappointment in the news from Delaware North, but said the state remains committed to Aqueduct’s redevelopment. He said the state would reopen the bidding process to find an operator for a casino at the racetrack.

In October, the Paterson administration announced that it had a deal in place with Delaware North to build an elaborate gambling complex at Aqueduct, appearing to end a nearly seven-year political battle over the project. The project was first pitched in 2003, during the administration of Gov. George E. Pataki, during a previous budget crunch, and it was also pursued by Gov. Eliot Spitzer.

The casino was to include a 184,000-square-foot gambling floor and 4,500 video gambling terminals as well as restaurants, a hotel and a 60,000-square-foot conference center. Construction was to have started early this year. Delaware North operates a similar casino in Saratoga Springs.

Critics have said that the state should not turn to gambling to fill its coffers, particularly in a recession. But the lure for the state is clear: It expected to take in billions of dollars in revenue over the next few decades.

A more immediate problem is replacing the $370 million that the state had expected to receive upfront. Now lawmakers will have to make due without that money three weeks before the end of the fiscal year and the state budget deadline.

“We now have another hole to fill,” said Assemblywoman Audrey I. Pheffer, a Queens Democrat whose district includes Aqueduct.

“I’m very disappointed, I’m very upset, I’m really angry,” she said, but added, “I don’t know who to blame.”

Delaware North intends to stay with the process. It beat out two other bidders last year.

Referring to the governor’s office, Mr. Bissett said, “While we disagree with their conclusion that a rebid is necessary, we nonetheless remain interested in developing Aqueduct and look forward to continue work with administration to achieve that goal.”

__________________NEW YORK. World's capital.

“Office buildings are our factories – whether for tech, creative or traditional industries we must continue to grow our modern factories to create new jobs,” said United States Senator Chuck Schumer.

NEW YORK CITY-The state is seeking new proposals to build and operate a 328,000-square-foot video lottery terminal facility at Aqueduct Racetrack in Queens, following the collapse last month of Delaware North’s deal to develop the racino there. Applications are due by close of business on Friday, May 8.

"Growing our economy through job creation and economic development projects such as the implementation of VLTs at Aqueduct will move our state toward the type of new economy New York needs to get back on track," says state Senate majority leader Malcolm Smith in a release. "Though it is disappointing that the process has been slowed due to the struggling economy, I am confident that we can find a new partner to build Aqueduct into a gaming location that bolsters the local and state economy." Citing difficulties in obtaining financing, Delaware North pulled out in early March after announcing that it would miss the deadline on a $370-million upfront payment to the state.

An updated version of the state’s memorandum of understanding was made public on Friday. Under the revised MOU, the state would enter into a 30-year agreement with the winning bidder, with a possible 10-year extension. The winning bidder would pay the full amount of its proposed upfront franchise fee no later than 10 business days after the execution of the MOU. The state would issue $250 million worth of personal income tax bonds through the Empire State Development Corp. to finance eligible VLT project costs.

The racino facility would be constructed by the VLT vendor, "which will be responsible for its design and construction subject to the terms of the MOU and applicable laws and regulations," according to a release. Neither ESDC nor the state will be responsible for construction or cost overruns, the release states.

Bidders on the project may propose modifications to this MOU, and the proposed changes will be considered by Gov. David Paterson, Smith and Assembly speaker Sheldon Silver. The three men will also decide the winning bidder.

NEW YORK CITY-SL Green Realty and Aqueduct Development Partners LLC has initiated legal action, Friday, against Delaware North (DNC) related to the Aqueduct Race Track redevelopment project in Queens. In the complaint, SL Green says that among other things, DNC had "derailed" its bids to operate wagering and other facilities at three New York thoroughbred racing facilities.

Court documents filed by SL Green and its wholly-owned subsidiary, Aqueduct Development Partners LLC allege that DNC engaged in "unlawful conduct in misappropriating for its own benefit the rights to operate wagering and other facilities." The complaint goes on to say SL Green now seeks to "recover its damages, as well as the damages inflicted on its former affiliate Empire Racing Associates, LLC caused by DNC’s unlawful scheme."

A spokesperson for SL Green says in a statement that "Delaware North’s actions as outlined in the complaint, damaged SL Green and Empire Racing Associates shareholders significantly." The same statement adds "they also harmed the people of New York, given the VLT’s at Aqueduct otherwise could have been up and running by now and would be delivering revenue to the state at a time the state sorely needs it."

Reacting to the news, Delaware North president William J. Bisset says in his own statement that DNC was made aware of the litigation yesterday, but as of today, had not been officially served papers. He added that "based on what we have read in the press reports, it appears to be a desperate attempt by SL Green to try to enhance their standing in the re-bid process."

For its part, SL Green says that yes, it is in fact still interested in developing the project and is now reviewing the state’s instructions released last week in anticipation of the new proposal.

"We are in the best position to move forward with the project right away, especially given that we already have been fully vetted," says SL Green in a statement. "If given the go-ahead, we could be producing revenue for New York’s taxpayers within six months."

__________________NEW YORK. World's capital.

“Office buildings are our factories – whether for tech, creative or traditional industries we must continue to grow our modern factories to create new jobs,” said United States Senator Chuck Schumer.

NEW YORK - (Business Wire) On Friday, May 8, 2009, Aqueduct Entertainment Group, LLC, submitted a bid to the State of New York to build and operate a Video Lottery Terminal (VLT) facility at Aqueduct Race Track in Queens.

Aqueduct Entertainment Group, LLC (AEG), was formed for the express purpose of bidding on, winning and building a world class gaming and entertainment destination. Partners in the effort include:

-GreenStar Services Corporation, for development, construction and overall coordination;
-The Navegante Group, as the gaming developer and operator;
-The Darman Group, Inc. and Empowerment Development Corporation, as co-developers and minority and women-owned business coordinators;
-Siemens, as technology partner;
-PS&S, to lead the architectural, engineering and environmental effort; and
-CleanPower, an environmental firm, who will employ Green Building Strategies.
-Levine Builders, will provide construction management services.

The company will be chaired by Richard Mays, a former Arkansas Supreme Court Justice and nationally known attorney.

“The collective experience of our team and the offer that we have presented the State of New York, is one that we believe that no other bidder can top,” said Mr. Richard Mays, Chairman, Aqueduct Entertainment Group, LLC. “I am so pleased that the tremendous expertise of GreenStar and the gaming knowledge of Larry Woolf and his Navegante team, enables us to guarantee that the State will not only get a VLT facility up in a timely manner, but that the returns on their investment, most importantly to education for all public school children in New York, will be the most that any bidder can provide.”

Aqueduct Entertainment Group, LLC will develop a facility to attract an audience from both the greater New York metropolitan area as well as the lucrative tourist market. In response to the State’s request, AEG is prepared to provide the State with an upfront payment as well as the promise of large returns for education.

“We are excited about participating in this bid to revitalize Aqueduct and the surrounding area,” said Larry Roman, Vice Chairman of GreenStar Services Corporation. “Our experience with large scale mixed-use facilities, public projects and high profile projects such as the Freedom Tower demonstrates that GreenStar is the best option for New York.”

The team shares a vision to create a world class gaming destination and entertainment venue in an area of New York City that has waited for years for someone to deliver on their desire to see an energized and rejuvenated Aqueduct facility for the local Queens Community.

“Developing and operating large scale gaming projects is what we do best, and have done all over the country and internationally,” said Larry J. Woolf, Chairman and CEO of The Navegante Group. “Our experience with projects such as the development and operation of Casino Niagara, the development and operation of the MGM Grand in Las Vegas, the operation of Caesar’s Palace in Atlantic City and our current portfolio of casinos throughout Nevada, elsewhere in the United States and internationally, should give comfort to the State of New York and the Queens community that we know how to bring the best and work with the local community to reap the greatest rewards.”

The project will also feature a Community Benefits Program designed to ensure that a percentage of the professional service contract dollars, the construction contract dollars, the retail space and the post construction contract dollars are awarded to minority and women owned businesses. As part of our program our gaming partner will implement a local resident focused workforce development initiative and we will work with Community Board # 10, The Queens Chamber of Commerce and other Queens based organizations to develop employment, training, recruitment, upgrading and referral initiatives. In addition, AEG partners are known for delivering projects on time and on budget.

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About GreenStar Services Corporation

GreenStar Services Corporation is the only full service self perform contractor in New York City. The company’s New York City based operating companies, WDF Inc. and Five Star Electric Corp., have each been leaders in the New York construction market for more than 50 years. Both companies have significant experience in public and private construction. WDF’s capabilities include general construction, plumbing and HVAC, while Five Star specializes in electrical construction. This unique combination of capabilities enables the Company to guarantee substantial completion dates and deliver the highest quality project.

Together, WDF Inc. and Five Star have completed some of the most important and impressive projects in New York City including the Time Warner Center, 15 Central Park West, Citi Field, the renovation of Yankee Stadium and the new Goldman Sachs World Headquarters. Recently they were selected to perform approximately $350 million of electrical and plumbing work at the Freedom Tower.

GreenStar will be intricately involved in all phases of the Aqueduct Project construction process - from design to completion. Their 50-year history of on-time or early completion of quality and safely built projects is unparalleled in New York. They will commit the resources necessary to achieve target substantial completion dates, as well as provide all required payment and performance bonds.

The Navegante Group is led by Larry J. Woolf the former Chairman, CEO and President of MGM Grand Hotels in Las Vegas. From 1990 to 1995, Mr. Woolf oversaw the pre-opening design, construction and operation of the famous 5000 room MGM Grand on the Las Vegas strip. MGM was not only the largest hotel in the world at that time, but was the first casino project that cost in excess of one billion dollars to develop. The Navegante Group currently operates five casinos in the United States and three casinos internationally.

The Navegante Group brings a wealth of experience to Aqueduct, having undertaken a similar project in Niagara Falls, Ontario resulting in an unmitigated success for the local area. The Casino Niagara consists of a total of 95,000 square feet of gaming space, including over 1,700 slot machines and 60 table games.

Navegante was selected over 27 other casino operators (many of whom were publicly traded) to become the sole Agent for the Ontario Casino Corporation to design, construct and manage Casino Niagara.

Navegante was responsible for planning and developing the operation of the $180 million casino, as well as overseeing the facility’s construction. Six months later, the world-class Casino Niagara opened to the public to rave reviews with 3,200 employees and all systems, internal controls, procedures and necessary supplies in place and fully operational. All of this happened ahead of schedule and under budget. The Government of Ontario was paid back their 180 Million in 180 days.

Navegante Group is comprised of seasoned gaming industry professionals. The core team is made up of personnel who have held top executive level positions with most of the leading industry operators. Navegante has been involved in numerous ground-up projects and countless gaming facility openings and the firm specialized in the hiring and training of local community members to staff its projects. They also implement state of the art problem gambling programs in conjunction with their casino developments While Navegante possesses extensive experience in gaming operations, they also bring an owner’s perspective to decision making as owners and co-investors in some of their projects.

The Darman Group (TDG) is a 33 year old wholly minority owned firm. It includes a consulting division and real estate development division which undertakes projects for its own portfolio. TDG has a well developed reputation for its work with public agencies and is generally recognized in the New York City construction industry as one of the premier sources of expertise in the area of regulatory compliance requirements and diversity management initiatives.

Over the years they have authored programs for a number of major governmental agencies and several private developers and major contractors. Included in their list of projects as consultant is the multi-billion dollar Battery Park City, the billion dollar plus MetroTech Center in Brooklyn, New York and, most recently, the New Nets Arena and Atlantic Yards Development project which includes an unprecedented community benefits program.

TDG will be working in joint venture with Empowerment Development Corporation as co-developer of the project. Empowerment Development Corporation was created by Rev. Floyd H. Flake to pursue private community development initiatives. Rev. Flake has pastored The Greater Allen Cathedral for more than 30 years. During that time he has been responsible for the development of more than 1300 units of housing as well as commercial and institutional projects in the borough of Queens. In total his projects amount to more than $150 million dollars of completed developments.

DEVELOPMENT ACTIVITY

TDG’s development portfolio contains the following accomplishments to its credit in the role of developer:

Bronx, NY - Redevelopment of a mixed-use 188 unit housing project with 4,000 square feet of retail space
Queens Village, NY - Redevelopment of a building materials supply house
Rochester, NY - Redevelopment of an office building
Manhattan - Redevelopment of a 50,000 square foot office building in lower Manhattan
TDG is the only African American owned development company to be pre-qualified by the Pennsylvania State System of Higher Education (PASSHE) to develop projects on State University Campuses.

Paulus, Sokolowski and Sartor (PS&S) will provide architectural, engineering, and environmental consulting services to the Aqueduct Project. The firm and its affiliates, with offices in Westbury and Yonkers NY, is ranked among the Top National Design Firms by Engineering News Record and is listed in the top 15 engineering firms by Building Design and Construction.

PS&S has provided total building and site design and environmental permitting services for a large number of world-class gaming and hotel facilities. In Atlantic City, PS&S has successfully stewarded the most complex and demanding projects from the concept and permitting stage through to design and completion. Beyond Atlantic City, their portfolio includes corporate conference centers, resorts and hotels, large retail developments, sports stadiums, and athletic fields. Their extensive experience in the gaming industry gives them the knowledge and understanding to efficiently respond to the complex project needs specific to this market in the fast-pace it demands. PS&S understands the gaming industry. Representative clients and projects include: Atlantic City Hilton, Bally’s Park Place Hotel/Casino, Caesars Atlantic City, Red Bull Soccer Stadium and the Borgata Hotel Casino and Spa, to name but a few.

For the Aqueduct project, PS&S and Clean Power will employ their jointly-developed Green Building Strategies to reduce the environmental impacts of the development and reduce the building’s operating and life cycle costs, enhance occupant comfort and health, and improve occupant productivity.

Siemens AG (NYSE: SI) is a global powerhouse in electronics and electrical engineering, and operates in the industry, energy and healthcare sectors. For more than 160 years, Siemens has built a reputation for leading-edge innovation and the quality of its products, services and solutions. With 428,000 employees in 190 countries, Siemens reported worldwide sales of $116.6 billion in fiscal 2008.

With its U.S. corporate headquarters in New York City, Siemens in the USA reported sales of $22.4 billion and employs approximately 69,000 people throughout all 50 states and Puerto Rico. Siemens has more 3,000 employees in 63 locations in New York State and is a proud member of the Partnership for New York City.

Clean Power, Inc. is a total energy solution provider. We provide planning, design, building, operations, maintenance and financing to fulfill the renewable energy needs of large energy sector participants. By integrating all available, logical, and synergistic alternative energy solutions, each client will be availed of the most up to date and relevant access to the alternative energy solutions they need. Our experts in data collection and planning provide the client with the confidence that their energy solution is specific to their needs and location. At the same time, our expertise in financial markets, municipal bonds, and regulatory bodies allows Clean Power to deliver the most productive financial packages on the market. The result is a product that is financially sound and meets the real goals of each client.

This innovative, Queens-based company, founded in 1979, has successfully built, renovated and rehabilitated thousands of residential units and millions of square feet of commercial space, including hotels, office buildings, retail centers, religious, educational and healthcare facilities.

With integrity and ethics, Levine Builders has been providing general contracting and construction management services throughout the tri-state area for the last 25 years. Today, Levine Builders, and its affiliates, Douglaston Development and Clinton Management, are going strong. The diversity and range of work includes everything from luxury high-rise residential housing, hotels, affordable housing, assisted living facilities, as well as retail, mixed-use developments including the largest development built in Harlem in the last 20 years, and the restoration of an architectural landmark, 90 West Street, to its pre-9/11 glory. Douglaston Development is pioneering premiere new neighborhoods in Clinton, West Chelsea, Midtown Manhattan and Williamsburg, Brooklyn. Clinton Management, through the incorporation of new technology and standardization of procedures, provides state-of-the-art management services to the Levine organization.

Levine Builders has evolved into a full service company, with our staff being our greatest asset. We have a full array of experienced personnel providing expertise in all facets of the construction industry and related issues. In addition to our skilled management and field personnel, we have an in-house risk management department, a knowledgeable IT department that maintains pace with the latest technologies available, as well as an expediting department, which is led by our Building Codes Consultant, a registered Expeditor with the Department of Buildings.

Douglaston Development, an affiliate of Levine Builders, is currently developing The Edge, a $1 billion two-phased mixed-use project on the waterfront in Williamsburg, Brooklyn, which includes a water taxi landing, piers, and an esplanade. The Edge will consist of 347 moderate-income rental apartments, 1,100 luxury condos, 60,000 sf of retail space as well as parking for in excess of 600 cars.

This summer, Peebles, who Forbes recently ranked in the top 10 wealthiest African-Americans list and is worth $350 million, will open an office in Midtown and, last week, he was part of a team that submitted a gaming and entertainment bid for the Queens Aqueduct Racetrack redevelopment project to be operated by MGM Mirage. The proposal includes 4,500 video lottery terminals and multiple fine-dining establishments.

Tomorrow, he is speaking at the annual Queens Economic Development Corporation breakfast and said he's excited to share his enthusiasm and optimism in light of the current recession.

"Given the dysfunction in the marketplace, [the market has] presented some significant possibilities for companies like ours to come in and buy -- and buy well -- and be in a position where we could be able to come in and find some development opportunities," he said.

Peebles added: "My approach is, you buy when fewer people are buying and sell when fewer people are. It's a contrarian approach, but you go against the grain and you get rewarded for it."

Last year at this time, Peebles scheduled whirlwind days of meetings with investors and brokers as part of his New York launch. Plans for a luxury hotel are on hold, but the aqueduct project caught his eye and he developed this fine dining and gambling pitch. Peebles hopes that people want to stay close to home, and the aqueduct is a viable, local escape.

As he looks for office space himself, he is also buying up underdeveloped buildings and vacant lots throughout prime Midtown and several downtown sites, he said, keeping mum about any further details.

"What we're looking at is development sites that are under some significant distress, and where there are opportunities to buy and hold them until the next development cycle," he said.

But first he must consider how large an office presence he wants to have in New York -- a decision he is making in the coming weeks.

"I don't see development opportunities for New York City, aside from the aqueduct, for a while," he admitted. "I think it will take three to five years before there's an environment for any type of new development."

But, any hints of a recession just motivate Peebles to work harder, which is the message he'll share with Queens-based developers tomorrow.

"Now it takes a great deal more fortitude and insight and a great deal more vision to look at the current environment we're in and see opportunity. Now is not the time to focus and call it a day -- now is a time to camp out and find the opportunities and go into the woods," he said. "Now's the time of having hope and looking at the opportunities that are there."

__________________NEW YORK. World's capital.

“Office buildings are our factories – whether for tech, creative or traditional industries we must continue to grow our modern factories to create new jobs,” said United States Senator Chuck Schumer.